i've provided the reasoning behind a very simple speculative or malicious economic/non-economic attack scenario and have provided the 5 "M's" as justification. i'm not saying something like this will work, i'm just saying it is a possibility that needs to be considered and certainly one which i've never heard any of the core devs making this proposal even talk about:

1. Method: exploit the economic concept of a risk free put provided by the 2 way peg2. Means: gvt has a 143000 BTC address which they could use to pump into a SC causing, at the least, considerable uncertainty around Bitcoin's MC future. more likely, they could spark a run out of BTC into scBTC as the rest of us would seek or be forced to exploit the risk free put as well. an independent whale could also spark this run, i would say, depending on how much many BTC they have and if they want to take some additional risk with fiat buying.3. Mining: mining might be predicted to follow the move as we are currently over-secured and many miners are losing money as we speak. defecting over to a SC is not out of the question as they would be early adopters of a nascent, possibly more innovative SC that might obsolete the MC while being paid the same, if not more, via a sidecoin subsidy and scBTC tx fees that have the potential to increase greatly in price.4. Money: gvt could partner with Wall St who could start buying scBTC and their preferred form of sidecoin with printed fiat more fitting of their long term objectives as financial elite. their objective is to drive the price in an attempt to cause a run on BTC from the MC to the SC. they would be rewarded by buying scBTC while it is lower in price compared to BTC in the early stages. also sidecoin prices would be initially expected to be low as well.5. Motive: gvt/Wall St could destroy the Bitcoin MC via the forced migration of BTC to scBTC by causing volatility and fragmentation of mining security assisted with 51% attacks. this would be expected to drive the BTC price down.

fundamentally, i disagree with the core observation of the Sidechain Whitepaper which originally stated (interestingly, it seems they've changed it):

"the core observation is that “Bitcoin” the blockchain is conceptually independent from “bitcoin” the asset: if we had technologyto support the movement of assets between blockchains, new systems could be developed whichusers could adopt by simply reusing the existing bitcoin currency"

stop it. I'm saying it in the most friendly way, what you are doing is not healthy, you are simply trying too hard.

you can carry on. but you might as well create a thread. your infatuation for SC doomsday scenario is taking too much place in this thread, as others have mentioned (I recognize I am also guilty of entertaining this back n forth)

i appreciate and enjoy your market analysis pertaining to this thread's original topic so lets go back to that. if you create a different thread where you can sum up your scenarios for SC attacks and update your theory (which changes daily) I may discuss it there but from now on let's try and keep it on topic

This isn't doing anything to promot the innovation SC are supposed to represent.

I haven't read of one example where they provided an economic innovation that cannot be done with existing tech.

Instead some chose to insult me by PM, rather than give comment to my posts.

fundamentally, i disagree with the core observation of the Sidechain Whitepaper which originally stated (interestingly, it seems they've changed it):

"the core observation is that “Bitcoin” the blockchain is conceptually independent from “bitcoin” the asset: if we had technologyto support the movement of assets between blockchains, new systems could be developed whichusers could adopt by simply reusing the existing bitcoin currency"

as i've said since the start of my participation in Bitcoin: Bitcoin the currency is inextricably linked and intertwined with its blockchain. the blockchain is nothing without the currency.

i'd also flip that around by saying that Bitcoin the currency is nothing without its blockchain.

given all the potential risks and complexities introduced by Sidechains, are they something we should be serious about?

But they are not saying that in the way you suggest they are. Their point is not that Bitcoin the blockchain doesn't need "bitcoin" the asset but that the asset should not have to be tied only to the Bitcoin blockchain but could, conceptually, be used on other blockchains.

"I believe this will be the ultimate fate of Bitcoin, to be the "high-powered money" that serves as a reserve currency for banks that issue their own digital cash." Hal Finney, Dec. 2010

fundamentally, i disagree with the core observation of the Sidechain Whitepaper which originally stated (interestingly, it seems they've changed it):

"the core observation is that “Bitcoin” the blockchain is conceptually independent from “bitcoin” the asset: if we had technologyto support the movement of assets between blockchains, new systems could be developed whichusers could adopt by simply reusing the existing bitcoin currency"

as i've said since the start of my participation in Bitcoin: Bitcoin the currency is inextricably linked and intertwined with its blockchain. the blockchain is nothing without the currency.

i'd also flip that around by saying that Bitcoin the currency is nothing without its blockchain.

given all the potential risks and complexities introduced by Sidechains, are they something we should be serious about?

But they are not saying that in the way you suggest they are. Their point is not that Bitcoin the blockchain doesn't need "bitcoin" the asset but that the asset should not have to be tied only to the Bitcoin blockchain but could, conceptually, be used on other blockchains.

Conceptually... Yes. It is an interesting concept. Proof of that, is that we are even taking up pages about it here, and it is pretty off-topic.It will have an interesting journey from concept to market reality.At the moment, it remains a concept.I like the concept, the details will be very important to implementing it. It would be very easy to get it wrong, and underestimating the challenge it presents would be at our own peril.The most likely outcome is that it will add value to bitcoin, and subtract some value from some speculators.

fundamentally, i disagree with the core observation of the Sidechain Whitepaper which originally stated (interestingly, it seems they've changed it):

"the core observation is that “Bitcoin” the blockchain is conceptually independent from “bitcoin” the asset: if we had technologyto support the movement of assets between blockchains, new systems could be developed whichusers could adopt by simply reusing the existing bitcoin currency"

as i've said since the start of my participation in Bitcoin: Bitcoin the currency is inextricably linked and intertwined with its blockchain. the blockchain is nothing without the currency.

i'd also flip that around by saying that Bitcoin the currency is nothing without its blockchain.

given all the potential risks and complexities introduced by Sidechains, are they something we should be serious about?

But they are not saying that in the way you suggest they are. Their point is not that Bitcoin the blockchain doesn't need "bitcoin" the asset but that the asset should not have to be tied only to the Bitcoin blockchain but could, conceptually, be used on other blockchains.

first, some general observations of the current state of Bitcoin. as it is, the MC network is running at its top and peak efficiency. that being,

1. most BTC are being held safely tucked away in cold storage wallets all over the world. this is a result of 5.5 yrs of time, work, and accumulative effort on behalf of these holders/savers. in fact, these saved BTC should be viewed as being held in equilibrium with those BTC being used for more active speculation and day trading. there is a delicate balance going on here from a market perspective which leads to what we call the price. anything that forces those BTC to be mobilized from cold storage would cause severe volatility and most likely a decrease in value as it would indicate a market perception that something significantly different has been introduced into the system. 2. mining hardware and infrastructure build out has gone thru an impressive and exponential rise over the last several years also based on a tremendous amount of work and investment capital put at risk. this is ensuring the security of the entire Bitcoin concept and encouraging savers and speculators to hold their Bitcoin based on the confidence in these miners. this mining, directed solely at the MC at the moment, can also be considered to be in a delicate equilbrium. anything that disturbs this equilibrium will cause volatility and most likely loss in the value. 3. in this sense, one could conceptually visualize Bitcoin as a runaway train that continues to speed ahead, just out of reach of attackers who wish to kill it. it is critical that Bitcoin always stays just that bit ahead of its attackers in terms of its mining capabilities (for security purposes) and in the development of its cryptography (also for security purposes). anything that introduces volatility into this situation and causes Bitcoin to deviate from this continual forging ahead has the potential to derail the entire system as it will destroy value.

the above assumptions have resulted in an optimum distribution of coins for all Bitcoin participants into the MC. this is a good thing, despite how some detractors have tried to label holders/savers as hoarders which, imo, is a blatant attempt at denigration as well as a misunderstanding of Bitcoin economics. i won't go into that debate as it has been flushed out numerous times previously that "hoarders" are not hurting Bitcoin, and may in fact be helping Bitcoin. these peoples willingness to hold and thus value BTC helps support and drive the price upwards. these holders/savers have taken significant time and effort to store these BTC in cold wallets, sometimes in secure locations spread out all over the world. these people represent Bitcoin's most ardent supporters and are encouraged by the current growth in the system, specifically in mining, which protects their savings. having to mobilize these BTC's in the case of economic uncertainty or volatility introduced by a change in the Bitcoin ecosystem will cause these BTC to be exposed to hacking attempts and potential loss in value.

anything or anyone proposing a change to the Bitcoin ecosystem that disrupts this delicate economic mining equilibrium that we have achieved since Bitcoin's inception has to be put under severe scrutiny to demonstrate and prove, as close to a shadow of a doubt, that what they are proposing truly represents ground breaking innovation while at the same time demonstrating that they have considered all adverse economic scenarios that result as a consequence. and with good reason. with close to $5 billion in market cap at risk, an incorrect economic assumption resulting from a mistake in implementing a code change could lead to disaster. in fact, anything that causes increased volatility in this delicate balance has a significant chance of harming current Bitcoin holders.

4. Money: gvt could partner with Wall St who could start buying scBTC and their preferred form of sidecoin with printed fiat5. assisted with 51% attacks.

These two would have to be done with printed fiat to maintain the risk-free put. So basically they would have to steal from others to pull this off, which they are good at doing.

I think this attack is an extreme long shot, but a possibility I suppose. IMO, the benefits of side chains outweigh the risks. I would prefer decentralized side chains without changing existing core code, but from what I understand, that can't be done. So their proposal is the next best thing. We have known for a while that bitcoin needs to scale somehow. Whether SCs, TCs, increasing the block size limit, or a combination is necessary, bitcoin needs to scale to become a global reserve currency (I prefer the term backbone currency as I believe we should scrap as much legacy terminology as possible... the current fiat train wreck needs to be forgotten). Technically bitcoin is still in beta. This could be the last major change necessary for a finished product.

Counterfeit: made in imitation of something else with intent to deceive: merriam-webster

...2. mining hardware and infrastructure build out has gone thru an impressive and exponential rise over the last several years also based on a tremendous amount of work and investment capital put at risk. this is ensuring the security of the entire Bitcoin concept and encouraging savers and speculators to hold their Bitcoin based on the confidence in these miners. this mining, directed solely at the MC at the moment, can also be considered to be in a delicate equilbrium. anything that disturbs this equilibrium will cause volatility and most likely loss in the value. ...

Basic theory suggests that mining will always become unprofitable no matter what the various magnitudes of various parameters. We've seen in practice that this theory seems correct. What kind of sucks about this is that the value spikes have created conditions for more sha256 hashing power to develop than can be comfortably supported by transaction fees. At least when Bitcoin is used for buying trinkets.

The problem with this is that it could make economic sense for miners to attack Bitcoin, and this is particularly the case if they are going to throw in the towel on Bitcoin and consider their gear to be a write-off. Some combination of economics and corp/gov coercion could provoke such a decision.

Basic theory suggests that mining will always become unprofitable no matter what the various magnitudes of various parameters. We've seen in practice that this theory seems correct. What kind of sucks about this is that the value spikes have created conditions for more sha256 hashing power to develop than can be comfortably supported by transaction fees. At least when Bitcoin is used for buying trinkets.

The problem with this is that it could make economic sense for miners to attack Bitcoin, and this is particularly the case if they are going to throw in the towel on Bitcoin and consider their gear to be a write-off. Some combination of economics and corp/gov coercion could provoke such a decision.

The problem isn't that Bitcoin is used for buying trinkets - the problem is that Bitcoin isn't being used enough for buying trinkets.

The economics of mining are going to stay fucked up until the transaction rate grows about three orders of magnitude.

We just have to find a way to get from here to that point - after that it will take care of itself.

Sidechains to the rescue because they are highly tunable and can easily create incentives for people to WANT to use them. And, of course, the net effect economically is very close to using Bitcoin as native chain due to the two-way peg.

I don't actually use Bitcoin at the moment because it is not competitive with the alternatives as a means of doing most of the economic transactions I do. I do sell them from time to time however. If I were able to, rather than sell them, peg them to a sidechain which did something I liked (micro-transactions for instance, or allowed me to charge my PayPal account that way) I would much rather do that than go through fiat using something like Coinbase.

In fact, in addition to the sidechains push-back from fraudulent alts, a fair amount of pushback may come from outfits like Bitpay and Coinbase who could get cut out of the loop.

I think this attack is an extreme long shot, but a possibility I suppose.

please explain why.

1.) The 144,000 bitcoin is trackable. Users will be less likely to panic into a side chain they know is heavily invested in by the gov. Besides, I don't think 144,000 bitcoin is enough to cause a panic. A few of the top alts have market caps near or above this and I don't see a panic into those coins, of course those alts are not pegged so there is risk in moving.2.) Any buying of side chain coin and/or buying of processing power to attempt a 51% attack on the main chain will invalidate the risk-free put, even if printed fiat is used. 3.) Arbitrage of an asset pegged at the protocol level will probably be effective, especially if multiple exchanges are involved.

Of course the only thing protecting bitcoin from losing its MC status is the block subsidy, so there is real risk that over time bitcoin could cease to be the main chain.

Counterfeit: made in imitation of something else with intent to deceive: merriam-webster